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• Positive operating cash flows of $1.1m for the quarter
• Consolidated net cash position of $3.7m

Ava Risk Group Limited (ASX: AVA), (“Ava Group” or “the Company”), a market leader of risk management services and technologies, today releases its cash flow report (Appendix 4C) and provides an update on the key areas of activity for the quarter ended 31 March 2020.

Click here to read the full announcement.

Principal Activities
Ava Group is a security services and technologies company, that develops and commercialises a range of high security perimeter and access control products to protect military, government, industrial and commercial critical assets and infrastructure. These products are sold through its Future Fibre Technologies (FFT) and BQT Solutions (BQT) brands. In addition, the Company operates Ava Global, its international secure logistics division, delivering clients with reliable secure delivery for bank notes, precious metals, and other valuables.

Key areas of activity during the third quarter of the 2020 financial year related to:

• Across the Ava Group, and outside of usual business activity, preparing for and dealing with the impacts of COVID-19 took significant time and effort during Q3.  The business took sweeping action to educate our employees and implement appropriate health and hygiene measures, including reducing the need for people to come into our offices across the globe, based on local conditions. The health and safety of our staff and customers remains a paramount priority for the business.

• The Services Division continued to provide a full range of services to all of its customers, despite the reduction in air freight capacity around the world due to COVID-19. These restrictions allowed Ava Global the opportunity to innovate and offer a range of bespoke cargo and charter aircraft solutions to ensure that it could continue to deliver currency, precious metals and other valuable goods for its customers.  Client activity has significantly increased during Q3, with the addition of both new clients, and a wider breadth of services offered as a result.  This has been ably facilitated thanks to the depth of skills and experience within the Services Division.

• For the Technology Division, both FFT and BQT implemented additional COVID-19 control measures to enable us to continue production at our factories, ship and deliver orders, and to provide service support to keep products running smoothly.  Early March saw FFT’s new Aftermarket Sales Manager join the business, with his immediate focus on the rollout of FFT’s online remote technical support platform. This was particularly good timing for us, given all of the various travel restrictions, quarantine and isolation measures in place around the world, and meant that FFT was well positioned during the period to be able to capitalise on delivering online remote technical support capabilities to its customers.  FFT also continued its marketing efforts of its Aura IQ conveyor health monitoring solution, with several “Proof of Value” Trials commencing around the world during the quarter.  During the quarter BQT also completed the signing of a new Master Distribution Agreement for the supply of its locking products to a leading international locking products wholesaler in Europe.

Commentary on Appendix 4C Cash Flow Report
Net operating cashflows in the quarter were positive $1.1m an improvement of $1.3m on the previous quarter. This was due to increased cash collections from customers compared the prior quarter, up $0.4m, and lower operating costs, down $0.8m compared to the prior quarter.  The Group also continued development of the Aura Ai and Aura IQ platforms, increasing its R&D spending and intellectual property spending during the quarter, compared to the previous quarter.  

Noticeably cash receipts from customers in Q3 did not yet include any receipts from the Indian MoD project.  The first payment from this project was received as expected during April, being an amount of USD$0.9m (A$1.5m), in line with the 120 days project payment terms.

At 31 March 2019 the Company had $3.7m cash at bank and no debt.

An update on guidance for Ava’s FY2020 forecast will be issued separately to this 4C.

ENDS.

Approved for release by the Board of Directors.

For further information, please contact:

Scott Basham, CEO & Executive Director	Leigh Davis, CFO & Company Secretary
Ava Risk Group Ltd	Ava Risk Group Ltd
scott.basham@theavagroup.com	leigh.davis@theavagroup.com
+61 3 9590 3100	+61 3 9590 3103

AVA Risk Group Limited (ASX: AVA) has been included in the Financial Times Top 500 APAC High Growth Companies 2020.

Making the list at number 313, this new accolade follows Ava’s inclusion in AFR’s Fast 100 announced last month.

Commenting at the time, Ava Group CEO Scott Basham said, “Ava continues to go from strength to strength, and this recognition is a testament to the successful implementation of our growth strategy for the group.”

Read the report here.

Download the report here.

AVA Risk Group Limited (ASX: AVA) has been included in the 2020 AFR Fast 100 – with annualised revenue growth of 30% over past four financial years.

Commenting in the listing, Ava Group CEO Scott Basham said, “Being recognised as one of the AFR’s Fast 100 is a great accolade for Ava Risk Group Limited. Ava continues to go from strength to strength, and this recognition is a testament to the successful implementation of our growth strategy for the group.”

Ava Risk Group Limited (ASX: AVA) (Ava Group or Company) today provides the following market update with respect to previously provided guidance and the current implications of the COVID-19 pandemic.

Open for Business
Ava Group’s Technology Division (Future Fibre Technologies and BQT Solutions) and Services Division (Ava Global) are open for business. We are monitoring the health of our employees and to date we do not have any confirmed or suspected cases of COVID-19 within our workforce. We’ve taken action to educate our employees and implement additional measures including reducing the need for people to come into our offices across the globe, based on local conditions. At the same time, we know that customers rely on our products and services, and we are committed to continue production to deliver orders, and to providing maintenance support to keep deployed systems  running smoothly. A number of staff continue to work in our main offices, because certain jobs can only be done onsite, like those who assemble, test and maintain our products.,

Cash at Bank and Working Capital
As at 29 February 2020, Ava Group held A$3.3m in cash at bank and had no external debt or borrowings. In addition, Ava Group has access to a A$1.0m unutilised credit facility to further support any short term working capital requirements, and holds an unconditional bank guarantee for US$2.1m (A$3.7m) with regard to amounts owing under the IMOD project. As such the Company believes it has sufficient working capital available to meet its business operating requirements.

Emerging Risks
Like every business, there are risks outside of our control. Whilst we do monitor these risks in the ordinary course of business, and implement strategies to reduce the potential effect that they have on our business, the evolving COVID-19 pandemic is creating additional challenges, and in some cases, uncertain outcomes. Some of our operating risks have moved from low risk to medium/high risks, and their economic effect on our business, and our FY2020, are uncertain and still being quantified.

Technology Division (1H FY2020 circa 55% of Revenue):

• IMOD: We were expecting a majority of revenue for the $18m Indian Ministry of Defence (“IMOD”) project (previously announced) to be invoiced in FY2020 and the remainder in FY2021.  Our in-country manufacturing partner has advised us that they currently expect program delays, and believe that this may impact the previous schedule by up to three months. At this stage, Ava Group is  expecting revenue for the IMOD project in Q3 FY2020 to be approximately  A$2.1m, however  we are unable to provide a forecast for Q4 FY2020 until further clarity is provided by our manufacturing partner in India in due course.

• Inventory: Both FFT and BQT hold sufficient inventory to meet current forecast demand for FY2020. As a low volume manufacturer, with very large suppliers, we have not experienced any significant delays in our suppliers’ estimated production times. In the medium term, we appreciate there exists a  shipping delay risk, due to the broader effect COVID-19 may have on our suppliers’ manufacturing operations, and we will be monitoring this closely. We will continue to work with our suppliers to minimise the impacts from this risk factor.

• Supply Chain: Most of our components are delivered to us via airfreight from overseas based suppliers, and we ship finished goods to our customers via both airfreight and sea freight. The airline industry has announced large scale cancellations of passenger flights, which will reduce the fleet available for delivering commercial cargo. Several governments have placed restrictions on international travel, which may affect the ability of aircrew to move freely across borders. This will likely affect our ability in the medium term, to receive components in a timely manner.  This may need to be addressed by forward ordering additional components, which would consequently see an increase of inventory and reduction in cash (or increase in creditors). The reduction in airfreight operations may also delay the dispatch of some orders already received. Generally, we recognise revenue ex-works (when it leaves our facility). Whilst it is very much an evolving situation, at this stage we anticipate delays of some weeks (depending on destination) could occur.  We are working with our transport and logistics providers to monitor and address these risks. 

• Installation and Commissioning: Various travel restrictions, quarantine and isolation measures have recently been announced by governments around the world.  Such actions will likely affect our ability to provide onsite technical support to our customers and end users to undertake the installation and commissioning of our systems. In lieu of attending sites, we are offering online remote technical support capabilities to mitigate any impacts on those customers.  We will continue to monitor this risk closely to determine any ongoing effect on our business.

Services Division (1H FY2020 circa 45% of Revenue):

• Service Supply Chain: Ava Global provides services utilising an extensive network of secure ground transportation and airfreight partners. The airline industry has announced large scale cancellations of passenger flights which will reduce the fleet available for transporting valuable cargo internationally. Several governments have imposed border controls further restricting the ability to import and export cargo. Whilst we are seeing unprecedented demand for our services due to recent market consolidation and increased demand for wholesale currency, these restrictions will likely affect our ability in the short term to undertake certain shipments. Whilst it is very much an evolving situation, at this stage we anticipate restrictions to remain in place for up to two months.  This will delay revenues in a similar manner, and will result in some shipments (and associated revenue) being deferred, or in some cases, cancelled. We are working with our clients and partners to monitor and address these risks and to ensure we are able to meet demand once restrictions are relaxed or lifted.   

FY2020 Guidance
It is clear that the COVID-19 epidemic will have an impact on our FY2020 results and that all previous guidance will need to be reconsidered. To that end, we expect that the underlying business will achieve Q3 FY2020 revenues of between A$8.5m and A$9.5m with an additional A$2.1m from IMOD. The company is not is a position at this stage to provide any further guidance on FY2020 or FY2021.

Please refer to Note 1 below.

Approved for release for and on behalf of the Board of Directors by:

Leigh Davis

Company Secretary

For further information contact: Leigh Davis leigh.davis@theavagroup.com

About the Ava Group 
The Ava Group, comprising world leading technology divisions Future Fibre Technologies (FFT) and BQT Solutions (BQT) is a market leader in the provision of risk management services and technologies, trusted by some of the most security conscious commercial, industrial, military and government clients in the world. 

The Group features a range of complementary solutions including intrusion detection for perimeters, pipelines and data networks, biometric and card access control as well as the secure international logistics (Ava Global) and storage of high value assets. Through decades of innovation, the Ava Group continues to build upon a comprehensive portfolio of premium services and technologies for the most complex and demanding markets. 

Our business truly serves a global market, with our knowledgeable team spread across six continents, providing market and industry expertise directly to customers. With thousands of sites protected, the Ava Group is proven to deliver first class services and technologies that surpass the expectations of our partners and end users. 

Note 1

IMOD Contract Background:

• Ava Group has received and accepted a Purchase Order for US$11.9m (A$20.8m) of licencing income from its in-country manufacturing partner, SFO Technologies Private Limited (SFO).

• Ava Group has received a US$2.1m (A$3.7m) Bank Guarantee from SFO as security for SFO payment obligations to the Company under the contract.
• Post completion of the deployment of equipment into service with IMOD, Ava Group anticipates additional revenues will follow from a subsequent 7-year spares and maintenance contract for this project, which has an estimated value of a further US$3.4m (A$6.0m).

Further information on the IMOD project is available via previous market announcements (see www.asx.com.au)

Forward Looking Statements

Information in this release is for general information purposes only. Certain statements in this document regarding the Company’s financial position, business strategy and objectives, contain forward-looking statements (rather than being based on historical or current facts) and as such, are not able to be verified. 

All forward-looking statements are based on the current views of the Company’s management as well as reasonable assumptions made by, and information currently available to the Company’s management. Forward-looking statements are inherently uncertain and must be read accordingly. There can be no assurance that some or all of the underlying assumptions will prove to be valid. If assumptions are invalid this is likely to have an impact on the accuracy of the statement itself.

All data presented in this document reflects the current views of the Company with respect to future events.  Forward-looking statements are subject to a variety of risks, uncertainties and assumptions relating to the operations, results of operations, growth strategy and liquidity of the Company. Forward looking statements are also subject to external matters outside the control of the Company.

To the maximum extent permitted by law, the Company, its officers, employees and agents do not assume any obligation to release any updates or revisions to the information (including any forward looking statements) in this presentation to reflect any change to expectations or assumptions; and disclaim all responsibility and liability for any loss arising from reliance on this presentation or its content.

Dear Valued Customer,

Last week, the World Health Organisation declared COVID-19 a global pandemic. We want to assure you that Ava Group have a robust COVID-19 Pandemic Crisis Management Plan in place to protect the health and wellbeing of our employees, whilst ensuring that we continue to deliver a high-level of service to our customers.

We are currently on high-alert and the Ava Group management team is meeting regularly to ensure that we are able to react quickly in the event of a worsening situation and to ensure that all employees receive ongoing education and information on best hygiene practises. Utilising the information available from the World Health Organisation and the Federal Department of Health, we have already implemented the following measures:

• All work-related international travel is restricted and requires CEO approval
• All work-related interstate travel to be reviewed on a case by case basis
• Employees that holiday overseas are required to self-quarantine for 14 days prior to returning to work
• Where possible, employees have been encouraged to work from home using laptops with a secure connection to our network and mobile phones to remain in regular contact.

While the safety of our employees is paramount, we remain committed to proactively managing our production and delivery timelines to meet the ongoing needs of our customers. With manufacturing primarily based Australia, we are at least geographically isolated which may lessen the impact on our workforce. For now this threat remains low, but as the pandemic continues, the potential for product delay grows.

We will continue to monitor and respond to this evolving situation as needed. However, during these uncertain times we encourage our customers to place purchase orders for priority projects as soon as possible to ensure timely fulfilment and delivery.

We trust that the this information provides reassurance that we are proactive in our approach to the safety of our employees and ensuring the capacity to deliver a high-level of ongoing service to our customers. We will continue to work closely with our suppliers and logistics operators to ensure any business disruptions are minimal.

If you have any further questions in relation to the Ava Group’s COVID-19 Pandemic Crisis Management Plan, please do not hesitate to contact me.

Yours Sincerely,

Scott Basham
Ava Group CEO

Dear Valued Customer,

This week, the World Health Organisation declared COVID-19 a global pandemic. We want to assure you that Ava Group have a robust COVID-19 Pandemic Crisis Management Plan in place to protect the health and wellbeing of our employees, whilst ensuring that we continue to deliver a high-level of service to our customers.

We are currently on high-alert and the Ava Group management team is meeting regularly to ensure that we are able to react quickly in the event of a worsening situation and to ensure that all employees receive ongoing education and information on best hygiene practises. Utilising the information available from the World Health Organisation and the Federal Department of Health, we have already implemented the following measures:

• All work-related international travel is restricted and requires CEO approval
• All work-related interstate travel to be reviewed on a case by case basis
• Employees that holiday overseas in ‘high-risk’ areas are required to self-quarantine for 14 days prior to returning to work
• Where possible, employees have been encouraged to work from home using laptops and mobile phones to remain in regular contact

The safety of our employees is paramount as is ensuring the capacity to deliver a high-level of ongoing service to our customers. BQT’s manufacturing supply chains are not currently impacted significantly by COVID-19 and BQT maintains inventories of component parts and finished goods that are sufficient to meet current customer demand and our expected production forecasts for the coming period. We are in constant communication with key suppliers and should this situation change we will ensure to update you further as promptly as possibly at that time.

With BQT manufacturing based in New Zealand we are at least geographically isolated which may lessen the impact of our workforce being unable to attend work. For now this threat remains low but as the pandemic continues the potential for delay in supply grows. We will monitor and react as needed but would encourage you to review your own stock levels and customer demand now.

If you have any further questions in relation to the Ava Group’s COVID-19 Pandemic Crisis Management Plan, please do not hesitate to contact me.

Yours Sincerely,

Matthew Nye-Hingston
Head of BQT Technology & Director BQT Operations

• $0.2m improvement in operating cash outflows on PCP
• Debtors balance increase of approximately $2.0m primarily due to Indian MoD and shipment timing for FFT orders
• Consolidated net cash position of $3.1m

Ava Risk Group Limited (ASX: AVA), a market leader of risk management services and technologies, today released its Appendix 4C for the quarter ended 30 December 2019. 

Click here to read the full announcement

Summary of Results
It was another quarter of strong revenue achievement with the group meeting guidance of $9m or more for Q2 FY2020 and $19m or more for H1 FY2020 on an unaudited results basis, excluding Indian MoD. Importantly, these results reflect continued revenue forecasting consistency.

This excellent revenue performance, along with operating efficiency strategies delivered a positive EBITDA result for the half year, a turnaround of more than $3m compared to the same time last year.

Net operating cashflows in the quarter were negative $0.2m a decline on the previous quarter. This was due to lower cash collections from customers compared the prior quarter, with a number of FFT orders shipped late in Q2 FY2020.  The group also increased R&D spending during the quarter, and continued to further develop the Aura Ai and Aura IQ platforms. In addition, payment of annual insurance premiums during the quarter contributed to the higher operating cash outflows compared to the previous quarter.   

At 31 December 2019 the Company had $3.1m cash at bank.

The group expects to achieve sales revenues A$11m or more for Q3 FY2020, including A$9m or more from the underlying business, and A$2m or more in licencing income from the Indian MoD project.

About Ava Group
The Ava Group, comprising world leading technology divisions Future Fibre Technologies (FFT) and BQT Solutions (BQT), and international secure logistics services division Ava Global,  is a market leader in the provision of risk management services and technologies, trusted by some of the most security conscious commercial, industrial, military and government clients in the world.

The Group features a range of complementary solutions including intrusion detection for perimeters, pipelines and data networks, biometric and card access control as well as the secure international logistics and storage of high value assets. Through decades of innovation, the Ava Group continues to build upon a comprehensive portfolio of premium services and technologies for the most complex and demanding markets.

Our business truly serves a global market, with our knowledgeable team spread across six continents, providing market and industry expertise directly to customers. With thousands of sites protected, the Ava Group is proven to deliver first class services and technologies that surpass the expectations of our partners and end users.

For further information contact: Leigh Davis leigh.davis@theavagroup.com

Note 1

Forward Looking Statements
Information in this release is for general information purposes only. Certain statements in this document regarding the Company’s financial position, business strategy and objectives, contain forward-looking statements (rather than being based on historical or current facts) and as such, are not able to be verified.

All forward-looking statements are based on the current views of the Company’s management as well as reasonable assumptions made by, and information currently available to the Company’s management. Forward-looking statements are inherently uncertain and must be read accordingly. There can be no assurance that some or all of the underlying assumptions will prove to be valid. If assumptions are invalid this is likely to have an impact on the accuracy of the statement itself.

All data presented in this document reflects the current views of the Company with respect to future events. Forward-looking statements are subject to a variety of risks, uncertainties and assumptions relating to the operations, results of operations, growth strategy and liquidity of the Company. Forward looking statements are also subject to external matters outside the control of the Company.

To the maximum extent permitted by law, the Company, its officers, employees and agents do not assume any obligation to release any updates or revisions to the information (including any forward looking statements) in this presentation to reflect any change to expectations or assumptions; and disclaim all responsibility and liability for any loss arising from reliance on this presentation or its content.

Ava Risk Group Limited (ASX: AVA) (Ava Group or Company) today provides the following market update with respect to the large scale supply of FFT’s SecureLink technology to protect data communications cables for the Indian Ministry of Defence (IMOD):

As previously advised to the ASX in December, Ava has received and accepted a Purchase Order for US$11.9m (A$17.5m) of licencing income from its in-country manufacturing partner, SFO Technologies Private Limited (SFO) and has received a US$2.1m (A$3.1m) Bank Guarantee from SFO as security for SFO payment obligations to Ava under the contract.

• Ava also previously advised that Manufacturing of the first batch of 600 systems, representing circa 25% of total contract volume, had commenced and on 18 December 2019, Ava advised the ASX that SFO had successfully completed the FAT for the first 200 systems.
• Ava can now confirm that the shipment of the first 200 systems from SFO to the end user was successfully achieved prior to end of December 2019.
• As a result Ava confirms that it expects to recognise revenue (licencing income) of circa A$1.5m in Q2.
• Production of the next 200 systems, expected to be shipped in January 2020, is well underway, with approximately half of these units now built and ready for dispatch by month end.
• The remaining 200 units from this first 25% of the project are expected be built and shipped in February 2020.
• As a result, Ava expects at least A$3m of the remaining A$16m in IMOD revenues to be recognised in Q3 FY2020, and the entire project to be delivered before the end of CY2020.
• Ava anticipates additional revenues will follow from a separate subsequent 7-year spares and maintenance contract for this project, which has an estimated value of a further US$3.4m (A$5.0m).

Ava will provide an update on our H1 FY2020 results and guidance later this month.

Approved for release for and on behalf of the Board of Directors,

Leigh Davis

Company Secretary

Please refer to Note 1 below.

About the Ava Group 

The Ava Group, comprising world leading technology divisions Future Fibre Technologies (FFT) and BQT Solutions (BQT) is a market leader in the provision of risk management services and technologies, trusted by some of the most security conscious commercial, industrial, military and government clients in the world. 

The Group features a range of complementary solutions including intrusion detection for perimeters, pipelines and data networks, biometric and card access control as well as the secure international logistics (Ava Global) and storage of high value assets. Through decades of innovation, the Ava Group continues to build upon a comprehensive portfolio of premium services and technologies for the most complex and demanding markets. 

Our business truly serves a global market, with our knowledgeable team spread across six continents, providing market and industry expertise directly to customers. With thousands of sites protected, the Ava Group is proven to deliver first class services and technologies that surpass the expectations of our partners and end users. 

Note 1

Further information on the IMOD project is available via previous market announcements (see www.asx.com.au)

Forward Looking Statements

Information in this release is for general information purposes only. Certain statements in this document regarding the Company’s financial position, business strategy and objectives, contain forward-looking statements (rather than being based on historical or current facts) and as such, are not able to be verified. 

All forward-looking statements are based on the current views of the Company’s management as well as reasonable assumptions made by, and information currently available to the Company’s management. Forward-looking statements are inherently uncertain and must be read accordingly. There can be no assurance that some or all of the underlying assumptions will prove to be valid. If assumptions are invalid this is likely to have an impact on the accuracy of the statement itself.

All data presented in this document reflects the current views of the Company with respect to future events.  Forward-looking statements are subject to a variety of risks, uncertainties and assumptions relating to the operations, results of operations, growth strategy and liquidity of the Company. Forward looking statements are also subject to external matters outside the control of the Company.

To the maximum extent permitted by law, the Company, its officers, employees and agents do not assume any obligation to release any updates or revisions to the information (including any forward looking statements) in this presentation to reflect any change to expectations or assumptions; and disclaim all responsibility and liability for any loss arising from reliance on this presentation or its content.

Ava Risk Group Limited (ASX: AVA) (Ava Group or Company) is pleased to confirm that its Technology Division has received additional orders for Future Fibre Technologies’ (FFT) world leading perimeter detection systems from exisiting government clients:

• A$630k of purchase orders for FFT’s Aura Ai-2 platform have been received to protect sensitive US Government sites.
• A$350k of purchase orders for FFT’s SecureFence platform have been received to protect military installations in a South East Asian country.
• It is anticipated that around 55% of the value of the above mentioned purchase orders will ship and be booked as revenue in the current quarter.

Ava Group Chief Executive, Scott Basham said, “In a world of heightened security, our customers are looking to Ava to harden their security and improve their risk management processes. More than half of the value of the purchase orders are for upgrading sites protected by FFT’s legacy technology. The receipt of these purchase orders further demonstates the superior nature of our products and the large addressable market to upgrade the 1,900 systems already installed within our large global customer base.

Ava remains on track to achieve our guidance of A$9m or more for Q2, and A$19m or better for H1 FY2020 for the underlying business – excluding any contribution from the Indian MOD (IMOD) project.”

Please refer to Note 1 below.

About the Ava Group 

The Ava Group, comprising world leading technology divisions Future Fibre Technologies (FFT) and BQT Solutions (BQT) is a market leader in the provision of risk management services and technologies, trusted by some of the most security conscious commercial, industrial, military and government clients in the world. 

The Group features a range of complementary solutions including intrusion detection for perimeters, pipelines and data networks, biometric and card access control as well as the secure international logistics (Ava Global) and storage of high value assets. Through decades of innovation, the Ava Group continues to build upon a comprehensive portfolio of premium services and technologies for the most complex and demanding markets. 

Our business truly serves a global market, with our knowledgeable team spread across six continents, providing market and industry expertise directly to customers. With thousands of sites protected, the Ava Group is proven to deliver first class services and technologies that surpass the expectations of our partners and end users. 

Note 1

Further information on the IMOD project is available via previous market announcements (see www.asx.com.au)

Forward Looking Statements

Information in this release is for general information purposes only. Certain statements in this document regarding the Company’s financial position, business strategy and objectives, contain forward-looking statements (rather than being based on historical or current facts) and as such, are not able to be verified. 

All forward-looking statements are based on the current views of the Company’s management as well as reasonable assumptions made by, and information currently available to the Company’s management. Forward-looking statements are inherently uncertain and must be read accordingly. There can be no assurance that some or all of the underlying assumptions will prove to be valid. If assumptions are invalid this is likely to have an impact on the accuracy of the statement itself.

All data presented in this document reflects the current views of the Company with respect to future events.  Forward-looking statements are subject to a variety of risks, uncertainties and assumptions relating to the operations, results of operations, growth strategy and liquidity of the Company. Forward looking statements are also subject to external matters outside the control of the Company.

To the maximum extent permitted by law, the Company, its officers, employees and agents do not assume any obligation to release any updates or revisions to the information (including any forward looking statements) in this presentation to reflect any change to expectations or assumptions; and disclaim all responsibility and liability for any loss arising from reliance on this presentation or its content.

Ava Risk Group Limited (ASX: AVA) (Ava Group or Company) today provides the following market update with respect to the large scale supply of FFT’s SecureLink technology to protect data communications cables for the Indian Ministry of Defence (IMOD):

• Ava has received and accepted a Purchase Order for US$11.9m (A$17.5m) of licencing income from its in-country manufacturing partner, SFO Technologies Private Limited (SFO).
• Ava has received a US$2.1m (A$3.1m) Bank Guarantee from SFO as security for SFO payment obligations to Ava under the contract.
• Manufacturing of the first batch of 600 systems, representing circa 25% of total contract volume, has commenced.
• IMOD Factory Acceptance Test (FAT) has been scheduled for the first 200 systems in mid December 2019. It is expected that deliveries of systems will commence within 30 days of successful completion of the FAT. 
• Ava expects additional revenue from a subsequent 7-year spares and maintenance contract for this project, which has an estimated value of a further US$3.4m (A$5.0m).

Ava Group Chief Executive, Scott Basham said, “The receipt of this A$17.5m purchase order and A$3.1m bank guarantee are fantastic milestones for Ava in relation to this large scale project, and we are pleased that the manufacturing is now well underway for the first significant portion of the program. 

Our production and engineering staff are working hand in glove with the SFO team, providing technical advice and guidance on site in India, as they ramp up production volumes for the first tranche of systems, to ensure the smoothest possible execution of the manufacturing plan, and the successful achievement of the first FAT with the end user in mid-December. 

Ava’s Future Fibre Technologies business is clearly a global leader in the provision of best practice cybersecurity solutions for the protection of critical national data network infrastructure, and this 40,000km data network project for the Indian MOD is a clear testament to that fact.

Ava remains on track to achieve our guidance of A$9m or more for Q2, and A$19m or better for H1 FY2020 for the underlying business – excluding any contribution from the Indian MOD project – and this purchase order and bank guarantee now lock us in for a fantastic FY2020 and beyond.”

Please refer to Note 1 below.

About the Ava Group 

The Ava Group, comprising world leading technology divisions Future Fibre Technologies (FFT) and BQT Solutions (BQT) is a market leader in the provision of risk management services and technologies, trusted by some of the most security conscious commercial, industrial, military and government clients in the world. 

The Group features a range of complementary solutions including intrusion detection for perimeters, pipelines and data networks, biometric and card access control as well as the secure international logistics (Ava Global) and storage of high value assets. Through decades of innovation, the Ava Group continues to build upon a comprehensive portfolio of premium services and technologies for the most complex and demanding markets. 

Our business truly serves a global market, with our knowledgeable team spread across six continents, providing market and industry expertise directly to customers. With thousands of sites protected, the Ava Group is proven to deliver first class services and technologies that surpass the expectations of our partners and end users. 

Note 1

Further information on the IMOD project is available via previous market announcements (see www.asx.com.au)

Forward Looking Statements

Information in this release is for general information purposes only. Certain statements in this document regarding the Company’s financial position, business strategy and objectives, contain forward-looking statements (rather than being based on historical or current facts) and as such, are not able to be verified. 

All forward-looking statements are based on the current views of the Company’s management as well as reasonable assumptions made by, and information currently available to the Company’s management. Forward-looking statements are inherently uncertain and must be read accordingly. There can be no assurance that some or all of the underlying assumptions will prove to be valid. If assumptions are invalid this is likely to have an impact on the accuracy of the statement itself.

All data presented in this document reflects the current views of the Company with respect to future events.  Forward-looking statements are subject to a variety of risks, uncertainties and assumptions relating to the operations, results of operations, growth strategy and liquidity of the Company. Forward looking statements are also subject to external matters outside the control of the Company.

To the maximum extent permitted by law, the Company, its officers, employees and agents do not assume any obligation to release any updates or revisions to the information (including any forward looking statements) in this presentation to reflect any change to expectations or assumptions; and disclaim all responsibility and liability for any loss arising from reliance on this presentation or its content.